Brian Armstrong, CEO of Coinbase, informed CNBC's Joumanna Bercetche that the enforcement action the U.S. government took against Binance permits the cryptocurrency sector to "move on." Last week, the U.S. government imposed a settlement of $4 billion on Binance, causing its founder and CEO Changpeng Zhao to resign and admit to breaking laws regarding money laundering. Armstrong repudiated the view that cryptocurrencies are mostly utilized for illicit activities such as fraudulence, money laundering and terrorist funding though.
Brian Armstrong, Coinbase CEO, stated Monday that the crypto industry can now bid farewell to a spate of scandals and difficulties in the wake of the Department of Justice's unprecedented settlement against Binance. “This enforcement action against Binance has enabled us to draw a line under that era and put it firmly in the past,” he said during an interview with CNBC's Joumanna Bercetche. “There are a good number of crypto companies that are helping to create the crypto economy and revolutionize the global financial system; however, many of them are still fledgling startups.” Armstrong added that he believes that regulatory clarity should encourage more investment from institutions.
Binance was met with the U.S. DoJ’s penalty of $4 billion last week, which saw the resignation of its founder Changpeng Zhao and his plea of guilt for money laundering violations. The government indicted Binance of disregarding the Bank Secrecy Act and of contravening Iran’s sanctions.
In response to the opinion of many financial bodies that crypto is mainly used for criminal activities such as fraud, money laundering and terrorism financing, Armstrong defended the sector. “It is accurate that crypto has been intertwined in a small degree of illicit activities; however, this is less than 1% from our observations. In contrast, illicit uses of cash are far more widespread,” he updated CNBC.
He conceded that some players had been "bad actors", such as Binance, as well as the failure of crypto exchange FTX and the conviction of its founder Sam Bankman-Fried on fraud charges. Armstrong is in the UK on Monday for the Global Investment Summit, which brings together a number of business figures to promote foreign investment in the UK. Coinbase was the only crypto business invited to the summit, which Armstrong perceived as an "endorsement" for the company, though not necessarily the whole industry. Armstrong commented that he is "impressed" with British Prime Minister Rishi Sunak's stance on digital currencies and that Coinbase is investing more in the UK in consequence. The UK is aiming to bring digital assets such as cryptocurrencies and stablecoins into the regulatory system. Coinbase is currently engaged in a legal dispute with the US Securities and Exchange Commission over accusations that the firm breaches security laws with its platform. On this matter, Armstrong said he feels very confident about Coinbase's odds in fighting the lawsuit. Furthermore, he denied the idea that the SEC's steps have caused Coinbase to move abroad, adding that the company is investing heavily in its home market.
Correction: Sam Bankman-Fried was convicted on charges of fraud. An earlier version misstated his status.
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